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  1. #1
    Join Date
    Jun 2018
    Location
    Georgia
    Posts
    1

    Default Making Payments Toward an Old Debt vs. Settling the Debt

    My question involves collection proceedings in the State of: Georgia.

    Hello, so in February of 2012, I got a lease for an apartment which I ended up breaking the lease for a few months later for reasons. They never contacted me about this, and the first communication I had was from the collection agency they had given my case to. My credit report shows that was opened in August of 2012 (5 years, 9 months ago). I've not been in a position to pay anything towards this until recently, and I am now ready to get it paid off and clear up the last derogatory remark on my credit from my younger years.

    My issue is that I've dealt with other creditors in the past who were willing to set up payment plans for me to pay off things I owe them, but these people are not willing to do that. I've spoken with them before and when I offered to go ahead and put forward $500 towards the debt and keep doing that until it was paid off, they were less than receptive to the idea. They offered a "settlement" that was only a few hundred dollars short of the full amount if I paid it all at once, but I did not have that kind of money available to me at the time.

    Now, my understanding is that they cannot legally refuse any money I send them. So, if I sent them $500, they have to accept it and put it towards the amount owed, or I can dispute the debt altogether. I may be horribly misinformed and would love some clarification if this is wrong. I also want to know, is it better to pay towards the amount over the course of the next few months until it's gone, or save the full amount they want and pay it off in one go? Is either way more beneficial? What should my ultimate steps be with this? Please let me know if I need to clarify anything further, and thank you in advance for your help!

    Also, I cannot feasibly wait for it to hit the 7 year mark, as my boyfriend and I are moving forward in our relationship and I need to have good credit for reasons.

  2. #2
    Join Date
    Sep 2005
    Location
    Behind a Desk
    Posts
    98,623

    Default Re: Broken Lease Debt

    If you send $500 they will take your money and keep trying to collect the rest, but you will get no advantage in your negotiation of the debt from making that payment. I believe that under Georgia law a partial payment of a debt does not reset the statute of limitations on the debt, but in some states a partial payment will cause the statute of limitations to start over.

    If you defaulted in February or March, 2012, then the statute of limitations has run on the debt. The collection agent you spoke with may not understand that.

    If it were me, I would tell them, "Take [e.g., 20 cents on the dollar] or go away and never contact me again." Or I might just wait until the seven year mark when the debt should fall off of my credit report. If the debt is reported as settled, that's not necessarily going to bring about a significant increase in your credit score. Also a new report of a settlement may have more of an impact on your credit than a very old report of a debt. If you negotiate how any payment or settlement is to be reported on your credit, make sure you get that commitment in writing (signed by an authorized representative of the creditor) before you pay.

  3. #3
    Join Date
    Mar 2013
    Posts
    16,063

    Default Re: Broken Lease Debt

    Quote Quoting Mr. Knowitall
    View Post
    I believe that under Georgia law a partial payment of a debt does not reset the statute of limitations on the debt, but in some states a partial payment will cause the statute of limitations to start over.
    That includes GA.

    2017 Georgia Code Title 9 - Civil Practice Chapter 3 - Limitations of Actions Article 6 - Revival
    9-3-112. Payment or written acknowledgment equivalent to new promise
    A payment entered upon a written evidence of debt by the debtor or upon any other written acknowledgment of the existing liability shall be equivalent to a new promise to pay.
    https://law.justia.com/codes/georgia...ction-9-3-112/

  4. #4
    Join Date
    Sep 2005
    Location
    Behind a Desk
    Posts
    98,623

    Default Re: Broken Lease Debt

    That being the case, paying even a penny on the debt would be incredibly counter-productive, give the creditor many more years to sue you, and undermine your bargaining power.

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